1.     Introduction

The Soparfi (Société de Participations Financières) is one of the most frequently used vehicles to structure investments and perform financing and holding company activities in Luxembourg.  It is popular because it can benefit from a number of tax exemptions and take a number of different forms to best suit the needs of its shareholders.

2.     Legal Forms

Among the different forms that a Soparfi can take, there are the following:

  • Sàrl (Société à responsabilité limitée), which is a private limited company characterised by a high level of flexibility and a very limited degree of statutory prescriptions.  A Sàrl can be tailored to suit the needs of a single investor or two or more joint venture partners;
  • SA (Société anonyme), which is a public limited company.  A SA is likely to be used to make public offers of shares and debt securities from Luxembourg.  A SA can have a wide shareholder base and provide a high level of confidentiality to investors;
  • SAS (Société par actions simplifiée), which is a simplified form of limited company best suited to the needs of a start-up project;
  • SCA (Société en commandite par actions), which is a form of limited partnership.  SCAs are frequently used by private equity and venture capital managers who wish to retain control over their fund.

3.     Tax Exemptions

Provided certain conditions are met, a Soparfi can benefit from a number of tax exemptions in Luxembourg including the following:

  • no taxes on dividends and liquidation proceeds received;
  • no taxes on realised capital gains;
  • no withholding taxes on dividends, liquidation proceeds, interest and royalties paid;
  • no statutory thin capitalisation rules;
  • no exit taxes.

4.     Our services

FS REG can assist you to identify and incorporate in Luxembourg and other jurisdictions the right corporate vehicle to suit your business needs.  We can also help you to choose the right growth strategy for your business and advise you on the issuance of a broad range of equity, debt and other securities.

For more information, please contact us (www.fsreg.com).

Disclaimer:  This article provides general information only.  It is not intended to be comprehensive and does not constitute the provision of investment, legal or regulatory advice.  FS REG is not responsible for any action taken or omitted to be taken on the basis of this article.  © 2018-2019 FS REG Limited (www.fsreg.com).  All rights reserved.